Britain’s manufacturers are still struggling to increase their exports, the latest Industrial Trends Survey from the CBI has confirmed.
In its June survey of 448 manufacturers, 26 per cent reported their total order books to be below normal, versus 19 per cent saying they were above normal. The resulting minus 7 per cent balance was down from minus 5 in April and the lowest registered since July 2013. City analysts had expected the balance to strengthen slightly.
The deterioration was driven by weak export orders, where the balance fell back to minus 17 per cent, after improving to minus 7 per cent in May from a 26-month low of minus 26 per cent in March.
“Output and overall orders are still doing better than average but hopes that export demand would start to drive forward have not yet been fulfilled” said Rain Newton-Smith, the CBI’s director of economics. “Improving momentum in the eurozone is being offset by the effect of the strengthening pound on UK manufacturers’ overseas sales and margins”. She urged the Government to pledge support for struggling exporters in next month’s Budget.
The Cole Commission, commissioned by the Labour Party last year to report on the UK’s export industry, also urges the Government to do more to support Britain’s export growth. The independent report says ministers should look to five priority action areas, which includes a cabinet-level implementation committee to drive exports and reforms to UK Trade and Investment and UK Export Finance.
Graham Cole, the chairman of AgustaWestland UK, who led the review said: “Our recommendations are about culture, structure and mindset. There needs to be a role reversal in which government sees business as the customer. Leadership has to come from the top and, while we are pleased to see steps have already been taken to deliver cabinet level political accountability, we are also clear that business must also have a seat at the top table to drive through these changes.”
The Coalition set itself a target of increasing UK exports to £1trn by 2020, which has been reaffirmed by the current Trade minister, Francis Maude. But the most recent projections from the Office for Budget Responsibility show exports rising to just £617bn by 2019/20, suggesting the target will be missed by some distance.
The total value of exports in 2014 was £507bn, up from £447bn in 2010, according to the Office for National Statistics. Exports in the three months to April fell 1.7 per cent on the previous quarter.Reuse content